As market correction set in by the end of 2006 through 2008, it was evident that the Valley’s housing bubble had burst, and had moved into a strong Buyer’s market, with average MSIs ranging from 7.25 to 12.69. In 2009 and 2010, MSI moved back into the balanced range, with average MSIs of 5.27 and 5.52.


Year 2002 2003 2004 2005 2006 2007 2008 2009 2010


Avg. Mo. MSI


5.23 4.29 2.25 1.70 7.25


12.69 11.18 5.27 5.52


Market


Balanced Balanced Seller's Seller's Buyer's Buyer's Buyer's


Balanced Balanced


Normal is Not So Simple


The focus on a Valley wide MSI is a single, macro glimpse at a complicated issue. Many other factors beyond real estate serve as a backdrop against which the drama of our real estate mar- ket is played. In the early 2000s, the collapse of the dot-com bubble and the September 11th attacks brought about a short-lived (eight month) shallow recession. The Great Recession, marked by the subprime mortgage crisis, burst of the housing bubble and global financial cri- sis, started in December 2007 and ran through June 2009. The 2002 and 2003 markets were sandwiched between the two recessions as the economy entered the period of expansion be- tween the two.


It is reasonable to conjecture that a move back to “normal” for the Valley’s housing market would occur after the end of the Great Recession as the economy expands. That is happening right now. It could very well be that the answer to the question, “When will the market get back to normal?” is NOW.


WAVE - the ARMLS magazine June / July 2011 15


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24